The Tashkent Interdistrict Economic Court ruled to cancel the agreement between the Uzbekistan government bodies and the Turkish company Demir Group for reconstruction of the former Chorsu hotel due to default by the Turkish company to perform its obligations with the set timelines, the State Assets Management Agency said.
The agreement of March 9, 2018 stipulated that the JV Inter Tourism, set up by Demir Group, should have drawn at least US $ 33 million of investments before the end of 2019 from its own and attracted funds without guarantees from the Government of Uzbekistan.
The new four-star hotel complex was set to have 270 rooms with at least 350 jobs created. In September 2017, a presidential decree approved the sale of the Demir Group Chorsu hotel at a “zero” redemption value. The area adjacent to the hotel was supposed to turn into a Eski Shahar (Old City). tourist zone.
At the beginning of this year, the head of Demir Group Ahmet Demir announced about the problems with the implementation of the project related to paperwork and the difficulties of obtaining a loan. The authorities in response said that the investor must perform hiss obligations.
According to the State Asset Management Agency, the government ordered the hotel complex to be put for a re-bid.
Ahmet Demir is known for opening the first large supermarket in downtown Tashkent, which later grew into a large shopping complex. At the end of 2010, the Demir complex was alienated to the state, and Demir himself was expulsed from the country by the former auhtoritiies. Later in 2017 he was offered the Chorsu Hotel as a reimbursement for his losses in 2010 under investment obligations.